This subproject is one of many research subprojects utilizing the resources provided by a Center grant funded by NIH/NCRR. The subproject and investigator (PI) may have received primary funding from another NIH source, and thus could be represented in other CRISP entries. The institution listed is for the Center, which is not necessarily the institution for the investigator. The specific aims have been modified from those proposed in the original application. Sphingomyelin synthase (SMS) is a class of enzymes responsible for the biosynthesis of sphingomyelin (SM), by transferring a phosphocholine mojety from phosphatydylcholine (PC) onto ceramide. In the course of the reaction, a molecule of diacylglycerol (DAG) is also produced. Therefore, the biological importance of SMS, besides synthesis of SM, may reside in the regulation in opposing directions, of the levels of two important bioactive lipids, ceramide and diacylglycerol (DAG), which often play antagonistic roles in the control of key cellular functions such as proliferation, apoptosis, and/or differentiation. In mammalian cells, SMS is encoded by two recently identified genes, SMS1 and SMS2. Preliminary data from the PI's laboratory show Chronic Myelogenous Leukemia (CML) cells that express the bcr-abl oncogene have a significantly elevated SMS activity. CML is a myeloproliferative disorder of hemopoietic stem/progenitor cells and it accounts for 15-20% of adult leukemia. CML is initiated by the expression of the bcr-abl oncogene that encodes for a constitutively active tyrosine kinase which confers proliferative advantage and enhances cell survival, in part by inhibiting the tumor suppressor protein phosphatase 2A (PP2A). We showed that the increase of SMS activity can be recapitulated by expression of the bcr-abl oncogene in otherwise bcr-abl negative cells whereas inhibition of bcr-abl activity significantly reduces SMS activity. We also demonstrated that the bcr-abl-induced increase of SMS activity is due to increased expression of SMS1 and not SMS2 mRNA. Remarkably, inhibition of SMS activity to levels approaching bcr-abl negative cells significantly reduced cell proliferation of bcr-abl-positive progenitors and promoted their differentiation. Inhibition of SMS or bcr-abl activity in bcr-abl positive cells caused an accumulation of ceramide, and decrease of DAG, and down-regulation of PP2A partially reverted the block of proliferation observed upon inhibition of SMS activity. Since it is known that ceramide promotes PP2A activity, we HYPOTHESIZE that: 1) bcr-abl elevates SMS activity by enhancing expression of SMS1;2) elevated SMS1 activity in bcr-abl-positive cells sustains their tumorigenic potential;and 3) the bioactive lipids regulated by SMS1 are responsible for maintenance of the bcr-abl-dependent pro-tumorigenic signaling in part through a PP2A-dependent mechanism. To test our hypothesis, we will elucidate the mechanism of SMS1 regulation by bcr-abl (Spec. Aim 1) and determine the role of SMS1 in the tumorigenic potential of bcr-abl positive cells and its mechanism of action (Spec. Aim 2).